Atlanta International Arbitration Attorney
Resolving an international dispute or legal matter that involves parties from outside the United States can be a major challenge. In recent years, an alternative to litigation has been finding its way into contracts and other legal documents. The advantages are many, but any disadvantages can be challenging. Still, international arbitration is an alternative to the options already available in the legal sector. Unlike mediation, arbitration is more adversarial in nature, so it’s important that you have an experienced attorney who is talented in the area of arbitration and dispute resolution as they work to arrive at a favorable resolution or settlement in your case.
Are there financial benefits in international arbitration efforts?
Many see the international arbitration advantages from a financial perspective. Discovery is more limited usually, and appeal rights are generally very limited. Unlike the process in in the courts, the evidentiary portion of the arbitration is limited by the Arbitrator, so there will be a defined number of days for testimony. Much of the testimony may be presented by deposition, affidavit or testimonials depending on the rules set for the arbitration, which can save all parties significant fees and costs.
However, many of the international arbitration bodies charge substantial filing and service fees. The arbitration entity selected by the parties in their contract determines the fees and costs. Before making any definitive decisions, we encourage you to delve further and ask what their fees and costs are for the arbitration as well as the fees associated with potential counterclaims. One benefit of litigation is that the administration of justice is usually covered via tax dollars. However, both systems have cost advantages and disadvantages.
What is the discovery process in international arbitration?
Whether you’re involved in international commercial arbitration or arbitration over a business matter, it’s important to have the foundation in place early on. There are many considerations, including understanding what defines the process associated with depositions, interrogatories, requests for production, requests for admissions, inspection rights, and other tools of discovery they want to be included in the contract language. Remember that when you limit discovery in order to limit the costs, justice can sometimes be limited as well. If you omit depositions, you may find yourself without the ability to contradict a live witness who testifies against you. Many times, a contract with an arbitration provision will just say that any dispute will be arbitrated and will undergo the processes as defined by the rules of the arbitrating body. You need to know what those rules provide. We suggest that you define the procedures that you want, or you may find that multi-million dollar or billion dollar decisions rest on rules which were never reviewed by the parties prior to executing the agreement.
If it is not provided for in the contract, then what discovery is allowed is determined by the arbitrator or the rules of the supervising body for arbitration. In one case that we arbitrated under the International Chamber of Commerce Rules, the Arbitrator determined the scope of discovery allowed. In that case, one party objected to interrogatories being allowed. The Arbitrator allowed only three contention interrogatory as a result, which are basically non-specific questions related to particular allegations made in a pleading. The result was a dramatic increase in the number of costly depositions that had to be taken as a result of the ruling. Had the parties been able to send questions (interrogatories) to one another with answers being provided in writing, it could have reduced or even eliminated in person testimony as well as the need for so many depositions. Because the discovery rules were lacking in the contract, it becomes a costly process. As international arbitration attorneys in Atlanta, we work to ensure our clients are well-informed and prepared for the process at every step, including efforts to avoid unintended consequences.
An agreed-upon discovery process that includes the use of interrogatories, requests for production, depositions, affidavits and admissions can be invaluable in these international arbitrations. They play a big role in how well the process flows. It can truly streamline the efforts of both sides, which means lower costs and reduced legal fees. We will work to have these issues decided with opposing counsel if possible prior to the meeting with the arbitrator.
How is a discovery plan completed?
The best way to meet the discovery plan challenge is to reach out to the other side to address the needed information to decide the matter and the realistic timelines needed for each side to discover what will be needed during the process. This is also a good opportunity to determine the likelihood of whether or not the other side is going to file counterclaims, which could impact the scope of discovery in the arbitration proceedings.
Appeal rights are limited in most international arbitration proceedings. Within the arbitration body, you may have a right of review with the arbitrator and the oversight entity for correction or modification based on mathematical or overt procedural errors. However, such modifications and corrections are limited.
However, in certain cases, you may have the right to seek the vacating, modification or correction of an arbitration award in a federal US District Court. This process relates to which country’s law applies to the arbitration proceeding and if a particular convention applies. For example, in ICC proceedings in the US, if you wanted to try to vacate the award, you would generally work from the United Nations Conference on International Arbitration’s Convention on the Recognition and Enforcement of Foreign Arbitral Awards.
Within that document are certain grounds upon which a Court may vacate an award, but the application of the Federal Aviation Act, the standard of review and the nature of the facts and law being appealed must be very significant and related to those grounds directly. The burden is high to gain the vacatur of, or “set aside” an award, but there are many appellate decisions affirming such vacatur decision.
Language and Distance Issues
Both parties should be cognizant of certain language barriers and travel times. Hearings and depositions must be carefully planned to accommodate the international travel and business schedules of clients. In addition, interpreters may be needed in the process. Documents may be needed to be translated, and there could be a need for an agreement on an official interpreter since certain words may not be interpreted in the same manner in different languages. These logistics are important for the parties to consider at the beginning of the process.
Who chooses the international arbitrator?
It depends on the contract and the rules of the arbitration entity. Many of the arbitration societies such as the International Court of Arbitration allow for the parties to select the arbitrator(s) if they can. If they cannot, then the arbitration society will generally select the arbitrator. Some arbitrations will have one arbitrator, and other arbitrations may have 3 (or more) arbitrators as a part of the tribunal. We strongly suggest that the parties select the number of arbitrators it desires in the contract related to the arbitration provisions.
Typically, during the selection process, we discuss with our clients the potential arbitrators that are available. We carefully vet potential arbitrators, including interviews when allowed. In addition, we check references and often include social media in our due diligence. The chosen arbitrators must disclose in a statement any connection they have to the parties involved, including the attorneys who are representing the parties.
This information was posted on 08-23-2016 and does not constitute legal advice nor does it create an attorney-client relationship. The law changes on a daily basis and the reader should engage an attorney through a written agreement before taking action in this area of the law.